Income Taxes |
9 Months Ended |
|---|---|
Sep. 30, 2018 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes |
Income Taxes
The Company files income tax returns in the U.S. federal and state jurisdictions, as well as in foreign jurisdictions. The Company was part of a consolidated U.S. federal income tax return and consolidated and combined state returns through the date of Distribution with its former Parent and other subsidiaries that are not included in its Condensed Combined Financial Statements. The Company is no longer subject to U.S. federal income tax examinations for years prior to 2014, as part of the Company’s former Parent’s filings. The Company is no longer subject to state and local, or foreign, income tax examinations for years prior to 2009. During the nine months ended September 30, 2018 and 2017, the Company's former Parent paid $27 million and $75 million, respectively, of federal and state income tax liabilities related to the Company, which is reflected in its Condensed Consolidated and Combined Financial Statements as an increase to former Parent’s net investment. In the four months following the Distribution, the Company made federal and state income tax payments, net of refunds, in the amount of $27 million, excluding any assumed La Quinta tax liabilities. Additionally, the Company made foreign income tax payments, net of refunds, in the amount of $9 million during the nine months ended September 30, 2018 and 2017.
The Company’s effective tax rates were 28.4% and 42.0% during the three months ended September 30, 2018 and 2017, respectively. The decrease was principally due to the reduction in the corporate income tax rate resulting from the enactment of the U.S. Tax Cuts and Jobs Act.
The Company’s effective tax rates were 28.5% and 41.5% during the nine months ended September 30, 2018 and 2017, respectively. The decrease was principally due to the reduction in the corporate income tax rate resulting from the enactment of the U.S. Tax Cuts and Jobs Act.
The Company did not make any additional measurement-period adjustments related to the impact from the U.S. Tax Cuts and Jobs Act recorded for 2017 during third quarter. The Company was part of its former Parent’s consolidated 2017 U.S. federal income tax return that was filed during the fourth quarter 2018 and will be part of consolidated and combined returns for other jurisdictions that will be filed in the fourth quarter. As a result, the Company will be analyzing the impact on its estimates from the U.S. Tax Cuts and Jobs Act recorded in 2017, and expects to record any required adjustments during the fourth quarter of 2018.
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